Wednesday, July 29, 2009

So I was down at the Seattle Convention Center one day, earlier this year, and I encountered an art installation that was composed of a number of small LED boards, spread out over a couple of walls, across which words would scroll.

Some examples:

Words tend to be inadequatePrivate property created crimeAutomation is deadlyTorture is barbaricMost people are not fit to rule themselvesIt's better to study the living fact than analyze historyWhen something terrible happens, people wake upBelieving in rebirth is the same as admitting defect

The phrases scrolled across the screens in a seemingly random pattern. Sometime, all of the screens would display the same passage, while other times, each screen carried its own message. Sometimes they simply rolled along, while other times they flashed brightly. They were attention grabbing, but this didn't rescue them from being, at heart, banal, trivial, pseudo anarcho-socialist platitudes masquerading as profound commentary on modern Western society and some of its more visible institutions.

What makes it all the worse is that I think that it is possible to make short, profound statements.

Most people are bothered by those passages of Scripture they do not understand, but the passages that bother me are those I do understand.Mark Twain

Okay, so profound is overdoing it. But it's thought provoking and intelligently worded, while still being short enough to be a Tweet. And it's not overtly critical, just somehow off or based on dubious logic.

Thursday, July 23, 2009

Three not entirely related points, concerning something that we should be seriously dealing with, yet is quickly becoming lost in a teapot tempest.

Point One

The public dialog surrounding (but rarely actually touching) the arrest of Professor Henry Gates is essentially broken. The cause of its near total dysfunction is a simple idea that is deeply ingrained in the American psyche - that issues like this are, if you'll excuse the expression, black and white. Unlike other areas of our lives where we are better able to recognize that things break down because of failures and faults that build upon each other until the system collapses, when high-profile interpersonal conflicts like this one (and, let's face it, this was little more than a highly public pissing match between two aggrieved Alpha males) break out, we tend to see one person as the sole aggressor, and the other as a victim. I live near Seattle, and although we here are literally a continent away from the events in question, people have determined that their understanding of events is perfect enough that they may safely choose the person they most wish to identify with and make them a saint, while the other becomes an egregious sinner. This sort of willful oversimplification, more than being starkly inaccurate, is actively toxic, doing little more than harden hearts and minds.

Both sides of the story are actively shaping the narrative to suit their purposes, and cover their own contributions to the poor outcome. Pretending that either of them is above such things does a disservice all around.

Point Two

Many people have commented on the fact that it’s unwise to be visibly angry in the presence of a police officer. It’s not uncommon to hear people say that it’s sometimes not enough to even be respectful – an irritated police officer will often find grounds to arrest those they perceive as merely insufficiently deferential. Or that officers will arrest those they fear may lodge complaints against them, hoping to proactively tarnish their credibility.

The answer, we are told, is a simple one – be sufficiently deferential. But this is unsatisfying to many, and it smacks of a tendency that is common to many oppressed people: the idea that injustice is far preferable to injury. Had this tolerance for injustice been with Americans from that start, “Let freedom ring” would never have replaced “God save the Queen.” Sometimes we forget that the American Revolution was sparked over what today we would consider fairly minor grievances, and that a lot of people died for it.

Point Three

It is easy to gloss over the fact that Gates is African-American, and nearly sixty years old. While this may not matter to some, for a very large part of their history, African-Americans tolerated quite a lot of what we now consider heinous injustice. It was hardly a rousing success. And people of Gates’ generation are much closer to the history of lynching than younger people are. For many of us the dragging death of James Byrd in Jasper, Texas, was a throwback to ancient history. For those in Gates’ cohort it was a reminder of a time that they lived through when being murdered for the color of one’s skin was a very real, if very remote, possibility. Gates is also old enough to have lived through the civil rights movement, where simply being arrested for being insufficiently deferential to police officers was often an outcome to be prayed for.

We too readily accept that things that didn’t happen in a time and place that makes them matter for us shouldn’t matter to anyone else, either.

Tuesday, July 21, 2009

The government meddling in the automakers has already started, to fairly little attention. The House of Representatives is crafting legislation to force General Motors and Chrysler to reinstate the franchises of as many as 3,200 dealers that the companies had been planning to cut as part of their bankruptcies. The Senate seems to be working along the same lines.

The message that Congress seems to be sending is that the automakers got themselves into trouble mainly by paying out too much at the top of the pay scale. They seem to be poised to vet, and sometimes block, cost-cutting measures that would result in "injury to the little guy," and in doing so, they are announcing a de facto rejection of the automobile manufacturers claims that their overall labor cost structure and their incentives to dealers are part of the problem. And by forcing the automakers to retain dealerships to obtain federal funds, Congress can cast the companies as middlemen in a public bailout, rather than the recipients of a corporate one.

It's a gamble, but a relatively safe one. The public's memory is short, and selling out potential long-term prospects for tangible immediate gain is almost always a political winner. If you were going to boil this down to a pithy saying, it might be: "Government always has enough money to buy constituents a free lunch." As long as General Motors and Chrysler can keep afloat for a few years more, if they do go under, Congress will be able to deflect criticism that they played a role in it.

Monday, July 20, 2009

I was listening to Marketplace Money this weekend, and heard a commentary from their Economics Editor, Chris Farrell. He was critical of former General Electric CEO Jack Welch's comments that "there is no such thing as work-life balance; there are work-life choices," and that women who choose to spend significant amounts of time with their children do so at the expense of advancement prospects. One thing that struck me was that that Mr. Farrell equates having "a family" (in its form as a euphemism for "children"), as in simply having children in the home, with being an active and engaged parent. If people could simply hand over the responsibility of day-to-day child care to others who would do the job well, through "high-quality day care and good after-school programs," there would be no need to make trade-offs.

You could, if you chose, boil Jack Welch's comments down to a simple truism: "There are so many hours in day, and people who are willing to spend more of those hours advancing the interests of their businesses are likely to do better than people who spend fewer hours. Choose which is more important to you." You could then boil Mr. Farrell's comments down to: "Children are important, so business should make it easier to choose to have children by reducing the amount of time that parents need to directly spend with them, allowing parents more time to compete for promotions with their childless co-workers, while still thinking themselves responsible parents."

Okay, all well and good. But Mr. Farrell never satisfactorily answers one important question: Why should business be in the habit of choosing which of its employees' outside choices to support?

The impact of family friendly policies like these would be dramatic. We'd end up with more competition from women for the leadership ranks of society. We'd also have better family values.

The more I think about this, the more I come to conclude that Mr. Farrell actually hates children. Maybe what we need isn't more competition from women, but less from men. To the degree that women are in this situation because it's considered okay for working fathers to prioritize their careers above their families (spouses and children alike) I don't think that the answer is empowering working mothers to also routinely work long hours. It seems that if we're going to change social structures and rewards to change behaviors, we're better off prompting fathers to spend more with their wives and children, and pushing the childless to get the hell out of the office and go take a vacation someplace where power lunches and laptops are considered capital offenses. Since when does better family values come from the freedom of parents to pass their children off to others so that we can tell them that they shouldn't feel guilty about seeing their offspring as impediments to climbing the power structure?

I suspect that the issue with career versus family isn't that family isn't important enough. It's that career is too important - after all, Mr. Farrell tells us, it's doing well in the business world that counts.

Friday, July 17, 2009

Say you're a businessperson. A pretty successful one, and you've got the phat loot to prove it - you know, the house, the car, clothes, the private plane, the nookie on the side - everything that makes it known that you're money. You have all of this because you happen to be in control of a fairly substantial enterprise. So... you make it known that you're not happy with the present location of your little empire. What happens?

Well, city, county, state and (depending on just how big your business is, and where it is located) maybe even national governments start booking space on you calendar to pitch the advantages of their little corner of the world (usually including, it should be said, the government(s) whose jurisdiction you're planning on leaving). So far, so good. That's one of the things that government types are supposed to do - drum up opportunities.

The representatives of the governments will woo you with all kinds of present and future gifts. The present gifts will be small - little things like a free dinner or maybe they'll pick up the tab for you to come to their place and have a short vacation, so you can see it in person. The future gifts are where the money is at - maybe they'll give you the land for your new headquarters for free, promise not to charge you property taxes on your new factory or shell out for the infrastructure that you'll need to get everything set up.

Of course, all of these things cost money, and that money's got to come from somewhere, right?

Gary Lawrence, who heads the Economic Development Alliance of the city of Lubbock, in the Texas panhandle, explains that one electronics investment he backed cost the city $4.7m in revenue forgone over ten years. But in return the company undertook to create 165 well-paid jobs, creating a demand for houses that is increasing income from property taxes as well as sales taxes. The $4.7m should be written off in as little as three years.Tex-Mix. The Economist. July 11th, 2009

It's a common bargain. In return for low or non-existent tax burdens, businesses supply states, counties and municipalities with people who will pay taxes, and higher ones than they would have otherwise, to get jobs. It's not about lower taxes - it's about shifting taxes from businesses to individuals. And there's nothing inherently wrong with the plan. But it has to be realized that it can't go on forever. And when it ends, there's always another place ready and willing to take businesses that are looking for a better deal, and the citizens who'll be the ones to subsidize it.

Secure in an ironclad understanding of their own powerlessness, or maybe just because they don't do the math, citizens seem to always be willing to pay someone to bring them an opportunity. Of course, not everyone will like it. While the common refrain is that a rising tide floats all boats, some of them are, in reality, just washed away. Poorer people who don't see any benefit in the coming of a new business, may be pushed out by the higher property taxes that increased assessments of their homes will bring. Or perhaps the inflationary pressure that more money in the community sparks will do the trick.

It's not, in the end, that this is always a bad trade off. Far from it. A boost in income can, and many times does, more than make up for the boost in taxes and overall cost of living that shifting the burden away from businesses entails. But, despite the promises of politicians, it's not an unmitigated good. It has its downsides. And if you don't understand them, you can't make an informed decision about what's in your best interests.

You the successful businessperson would never go along with a deal without understanding what it entails, good, bad and indifferent. Why should you do so as an everyday citizen?

Wednesday, July 15, 2009

I've always wondered what would happen if you put a group of people who were convinced that everyone else in the world were sheep into the same place. But it's a little anti-climactic, though. Truth be told, I was kind of hoping for a knife fight.

But on the bright side, one of the great things about the internet is that you can find people who've had the same thought that you have. And created a funny webcomic about it.

Monday, July 13, 2009

True as it is, there's something very wrong with a system when having it actually live up to its name invites comparison with perhaps the single most destructive substance on the planet that people willingly put into their bodies.

The number of sex offenders, some convicted of pretty minor offenses, living under the Julia Tuttle Causeway in the Miami area has gone from about half a dozen to more than ten times that number. It's gotten to the point where one can have "Julia Tuttle Bridge" on a driver's license. The ACLU has now gotten involved, with a lawsuit designed to roll back some of the idiotically draconian residency restrictions that have created this situation.

In the meantime, everyone's passing the buck. Miami-Dade County blames the State of Florida, presumably for letting the men live anywhere, as they stand by their restrictions. The State, on the other hand, says state and local governments should do what's best for their communities, presumably as a way of washing their hands of the situation without appearing to be soft on sex offenders. Law enforcement officials, perhaps surprisingly, are trying to get someone to do something, realizing that they have a powder keg on their hands.

It’s not a good situation. It’s not a good situation for probation officers. It’s not a good situation for the offenders under the bridge, but it’s also not a good situation for public safety in Miami-Dade.Gretl Plessinger, Florida State Department of Corrections

But the public, apparently convinced that the worst that can happen is a group of bad people will simply die, move away or spend the rest of their days living lives of quiet desperation, thinks that it's just wonderful.

“These laws are always universally popular,” [Corey Rayburn Yung, an expert in sex-offender law at John Marshall Law School in Chicago] said. “The public loves it.”

And that means it is a good situation for politicians (never slow to score points with their constituencies at someone else's expense) - who we all know will promptly (and likely successfully) point fingers at someone else as soon as this situation detonates in everyone's faces. Which it will. It always does.

Sunday, July 12, 2009

Back in the Eighties, former Vancouver, Washington police Officer Clyde Ray Spencer was convicted of molesting his children and a step-child. He'd been sentenced to two life sentences plus fourteen years. In in 2004, a finding that prosecutors withheld exculpatory evidence prompted then-Governor Gary Locke to commute Spencer's sentence. Now, his children have come forward and recanted their statements to police. Although both children had been told that they were blocking out the memories of what happened by their mother when they were younger, it appears that they'd never been told the full extent of what it had been said was done to them, and are incredulous that they could have so completely suppressed what were billed as extremely violent and traumatic attacks. They testified for an appellate court, in their father's attempts to have his original no-contest plea thrown out and his convictions vacated.

In the face of this, Chief Criminal Deputy Prosecutor Dennis Hunter said that if the appellate court ruled to vacate, prosecutors might appeal to the state supreme court to have the convictions upheld. One wonders what he'd use to argue this, outside of simply pointing to the integrity of the system.

But Prosecutor Hunter isn't really one of the villains of this piece. Given that the case is seemingly on pretty shaky ground, he's going to have to attack the credibility of Spencer's now adult children - claiming that they were more credible at 9 and 5 years old, than they are now, perhaps by simply calling them liars motivated by some twisted love for an abusive father, or by taking the mother's tack that they'd managed to forget being violently and repeatedly sexually assaulted. But he's threatening to do this because he, like a lot of prosecutors, understands that (along with the police department) his office better maintains its credibility through fighting for a shaky case than admitting that they have helped put a man away for nearly a third of his life.

Saturday, July 11, 2009

"A strike, to be effective, must withdraw skills that cannot be replaced, and there seem to be fewer of them than there once were."George Will ("Northwest learning to fly without union" Seattle Post-Intelligencer, 18 September, 2005)

Among these difficult to replace skills, it seems, is aerospace machinist. Although union rules may also have something to do with that.

Which would serve to explain why Boeing is said to have complained to members of Washington's congressional delegation. According to the Seattle Times earlier this week, congress members and the governor were told: "Unless a long-term agreement barring strikes by the Machinists is reached by this fall, Boeing will build a second production line for the 787 someplace outside Washington."

The message is pretty clear - since we can't rein in the union, you guys had better find a way, or kiss a bunch of tax revenue good-bye. It's become a standard corporate tactic - holding a gun to the head of government, looking for leverage.

Let me see if I understand - if the International Association of Machinists agrees to give up the right to strike, Boeing will agree to do work in Washington state. Okay... I see what's in this for Boeing, and I see what's in this for Olympia... but I don't see what's in this for the union, or the workers.

Now, don't get me wrong. I'm not a huge fan of unions as a rule. The first time I read about "fair share" fees I vowed that I would open a business devoted to making people pay for the benefits that they derive from their neighbors having purchased a product from me. And don't get me started about closed shops. Unions enjoy a special status, and they're no more above abusing it than anyone else would be. But the idea that Government and Management should be working together to shaft Labor seems more than a little shady.

Boeing is hit with strikes because the workers don't like the deal that Boeing offers. Making it known that they'll move to whatever state is first to find a way to give Boeing the freedom to make whatever offers it wants, with little to no recourse for the workforce is their prerogative. But the public should set out to severely punish any state government that takes them up on it.

Tuesday, July 7, 2009

It's hard to understand, for those of us who have never actually lived it, that work that we find to be dangerous, demeaning or overly demanding for the remuneration it offers can often be a real step up for others. Which is why they go through so much to get it. There is a tendency to romanticize the poor, to say that they work as hard as they do out of some moral superiority to wealthier people. But, in reality, the reason why someone will trek thousands of miles for a job that pays them so poorly that they must share a single apartment with other whole families is that it's better than what they would have had, if they had stayed where they were. Working 12 hours a day for four dollars an hour seems awful - but it sure beats working sixteen hours a day for four dollars total.

To the degree that it makes hard labor desirable, poverty and deprivation are competitive advantages that poor countries have over their wealthier counterparts. And to the degree that poverty and deprivation make human labor inexpensive, they are also key components in allowing affluence to be created at a faster rate that tangible wealth. Which creates something of an incentive to perpetuate poverty on multiple sides of the issue. An overall increase in general wealth is undesirable to the leaders of poor nations, as it creates less incentive for business to locate there, and it's undesirable to foreign consumers, who would be the ones directly subsidizing that increase in wealth through hire prices for goods. It even creates a perverse incentive for the poor to stay poor - if they become too wealthy, the foreign businesses who provide the jobs will simply look for even poorer people to give them too, so once their income rises "too high," it falls off a cliff.

This brings me back to Pedro Nueno, the Spanish economist. His contention could be stated as Europe has exported too much of their poverty abroad, and that if European workers are going to compete in a global labor marketplace, they need to be prepared to re-import it - the alternative being, well, crushing poverty. The European welfare state (and the American one, for that matter) can only work as long as there are enough taxpayers to fund the unemployed. As more and more jobs head for the Third World, the ratio of taxpayers to welfare recipients shrinks, and eventually, the system (like a Ponzi scheme) becomes unsustainable.

Eventually, the First World is going to be in a position where they're competing with the Third World over who can make the lives of the unemployed the most disastrous, as both sides seek to drive a work ethic that's really little more than desperation. I can't see how anyone wins that game.

Sunday, July 5, 2009

Last month, Rhode Island’s Legislature approved a proposal to allow a ballot referendum in 2010 to change the state’s official name from “State of Rhode Island and Providence Plantations” to simply “State of Rhode Island.” According to The Providence Journal, “Proponents of the name change say the word ‘plantations’ is offensive to the African-American community because it conjures up images of slavery.”Sarah Vowel. A Plantation to Be Proud Of

Of all of the things that people find offensive, I must admit that I think it strange that being considered “thin skinned to the point of absurdity” is not among them.

But I have a bigger question. If the very word “plantation” is offensive, because of a connotation of slavery, what does one call a plantation? If you come up with a word that is still specific to what was once called a plantation, you might have a useful euphemism, but the new word will simply acquire all of the baggage that plantation has, and you’re back at square one. On the other hand, if you simply call them “farms” or something, to avoid conjuring up images of slavery, don’t you run the risk of effectively whitewashing a part of American history?

And should white people be offended by the negative connotations of the term “whitewashing,” and its association with coverups and disingenuousness? Just asking.

We tend to use the term "second-best" as a pejorative, describing something not worth having or someone not worth being. But after watching Andy Roddick spend more than four hours vainly trying to put away Roger Federer, I think that we'd do well to remember that sometimes second-best means "kicked every ass but one."

Friday, July 3, 2009

If we stipulate that Nueno is correct, and that the willingness of people in poverty to work long hours for minimal wages creates an effectively insurmountable competitive advantage, you still have the problem of implementation. Most industrialized Western nations are republics (or at least somewhat credible facsimiles thereof), and it really seems that saying: "Hey, everybody! We're going to slash the minimum wage and lengthen the working day to 12 hours. Oh, and kiss unemployment benefits buh-bye," is pretty much the very definition of "political suicide." Torch and pitchfork retailers would be forever in your debt.

So... how on Earth does one make such an idea fly? How do you get people to support importing poverty, rather than simply ratcheting up protectionist policies? You could lie to people, but once the policy goes into effect, you'd still have an uproar on your hands, and unless you disenfranchised everyone that loses out, someone would come along and make unseating you the main plank of their platform. So you'd have to convince workers that beating the third world's poor at their own game (and by their rules), while living in wealthy nations along side the richest people on the planet, is to their direct benefit.

I've been wracking my brain trying to figure this out, and I'm fast coming to the solution that economists would make terrible politicians.

Wednesday, July 1, 2009

This is the sort of thing that gives Conservatives reason to sneer at Liberal societies. When Spanish police raided textile sweatshops in Mataró, Spain, near Barcelona, and freed hundreds of Chinese workers, the immigrant workers, many of them in Spain illegally, hit the streets. They picketed not the poor conditions that they were working under, but the authorities for intervening. The Chinese are upset that they aren't being allowed to work illegally for long hours and low pay, because those pesky Euro-zone labor laws are keeping them from jobs that would horrify Spaniards, but are better than they could get in China. Of course, its those same European laws that allow them to protest in the street without them being simply rounded up and unceremoniously shipped back to China, but that doesn't count.

As ludicrous as the situation seems, there support for the idea that the willingness of Chinese laborers to be virtually locked into their workplaces and work seven days a week should be emulated worldwide. Pedro Nueno (I don't know that I've spelled that properly), a Spanish economist, says that European labor laws must be changed to allow for workers in developed nations to work under the same conditions that third world workers labor under. Twelve-hour days and low salaries should be the norm, he says. Otherwise, more and more jobs will depart for the Far East. The solution, it seems, to the exportation of jobs is the importation of poverty.

I understand the logic, but the idea that setting worldwide workplace policies around the idea that the poorest nations in the world must remain uncompetitive in a global labor marketplace seems like a recipe for a true new feudalism, where you have an aristocracy that owns all that they survey, and a peasantry that owns little, other than their bodies. If 60 plus hour workweeks and minimum wage salaries become the norm in the developed world, that might remove some of the incentive to shift jobs overseas, but that would require a catastrophic crash in the cost of living to be workable. What do we do when jobs start moving to Africa, where many poor people scrape by on a dollar or two a day? Granted, it likely won't come to that soon. Western consumer economies operate on having a respectable proportion of the population making enough money to buy consumer goods. If the working class of the society finds itself making $20,000 (or less) annually, there won't be many people able to buy the new cars or the big-screen televisions. But there was a point in time when the economy didn't need a large or sustainable middle class, and it's a fool's idea to think that the movers and shakers won't adapt their business models to work within that structure, if we go back to a system where subsistence wages are the widespread norm. While it's fashionable to complain about being oppressed by "the man" here in the developed West, a return to company towns, scrip and wages so low that the longer you work, the greater the debt you amass to your employer would REALLY give people something to complain about.

So I was listening to Marketplace the other day. They reported that the FDIC estimates that banks pull in around $17 billion dollars worth of overdraft charges annually. (And this might be set to go up as banks look to replace falling revenues from credit cards, now that new rules have taken effect.) In the same story, we also learn that the average overdraft fee is $35. To get to $17 billion at $35 a pop, you need more than four hundred eighty-five million transactions. That's in the area of one and a half times the entire population of the United States.

Given that not everyone in the United States has a bank account, and not everyone in the United States with a bank account overdraws their checking account at least once a year, there are some people who are bleeding themselves dry with multiple charges annually. While Nessa Feddis at the American Bankers Association claims that people are willing to pay for having transactions go through, I suspect that Jean Ann Fox at the Consumer Federation of America is also on the right track when she effectively contends that the banks have made covering overdrafts into a product - one that's profitable enough that there's no reason for them to discourage even accidental purchases.